A blog for students of Professor Kagan's internet course to comment and highlight class topics. From the various channels for marketing on the internet, to multimedia and e-commerce business models, anything related to the class is fair game.

Monday, June 22, 2009

People (mostly women who've snuck out of the office) jamming into a temporary space on the 6th floor of some building in the fashion district. Elbows are flying, the aisle is the fitting room and a great find usually comes after digging through 3 large bins. Oh, and the sign on the door reads "Cash Only". Returns? Yeah, right....

For those of you who know what I'm talking about, you are the exact audience that Gilt Groupe(www.gilt.com), an e-commerce company, is targeting. The site launched in 2008 and has revolutionized the way we think about sample sales. The basic idea is that the website (which is member's only) provides users with daily sample sales which are specific to one designer and last about a day. The sales all start at exactly noon. The featured designers are both established (Calvin Klein) and trendy (Steven Alan)

Suddenly, it's as easy as turning to the internet at noon everyday to see what's for sale. The images are clear, the functionality (can you say ZOOM) is outstanding, the search capabilities (by size, color, style) all well thought out --- and they allow returns!! Moreover, the company has done a fabulous job with the marketing and administration of the site. The marketing team puts together videos so that members get a sense of the designers that will be in the upcoming sales - though none of the actual items can be seen. Most importantly, because the sales "open" at exactly noon and items sell out quickly, it's an and incredibly strong incentive for users to log on everyday to check it out. There is a sense of urgency. They dont want to miss out.

And it seems to be catching on. According to compete.com Gilt's monthly uniques have grown from approximately 100K in May of 2008 to 500K in May of 2009 - and remember, you have to be a member to log on (membership is gained by invitation from an existing member).

Of course, once someone finds a good thing, others are likely to follow. Users can now log on to several sites attempting to replicate the Gilt Groupe model - www.ruelala.com, www.editorscloset.com, etc. The question now is whether the market is big enough for all the competitors and whether Gilt can use its first mover advantage and unique positioning to maintain an edge.

Sunday, June 21, 2009

Political revolutions are often closely linked to communication tools. The American Revolution wasn’t caused by the proliferation of pamphlets, written to whip colonists into a frenzy against the British. But it sure helped.

SHADISHD173/TWITPIC, via Agence France-Presse — Getty Images

A THOUSAND WORDS Tweets stop at 140 characters. A tweeted photo can have a fuller impact.

Social networking, a distinctly 21st-century phenomenon, has already been credited with aiding protests from the Republic of Georgia to Egypt to Iceland. And Twitter, the newest social-networking tool, has been identified with two mass protests in a matter of months — in Moldova in April and in Iran last week, when hundreds of thousands of people took to the streets to oppose the official results of the presidential election.

But does the label Twitter Revolution, which has been slapped on the two most recent events, oversell the technology? Skeptics note that only a small number of people used Twitter to organize protests in Iran and that other means — individual text messaging, old-fashioned word of mouth and Farsi-language Web sites — were more influential. But Twitter did prove to be a crucial tool in the cat-and-mouse game between the opposition and the government over enlisting world opinion. As the Iranian government restricts journalists’ access to events, the protesters have used Twitter’s agile communication system to direct the public and journalists alike to video, photographs and written material related to the protests. (As has become established custom on Twitter, users have agreed to mark, or “tag,” each of their tweets with the same bit of type — #IranElection — so that users can find them more easily). So maybe there was no Twitter Revolution. But over the last week, we learned a few lessons about the strengths and weaknesses of a technology that is less than three years old and is experiencing explosive growth.

1. Twitter Is a Tool and Thus Difficult to Censor

Twitter aspires to be something different from social-networking sites like Facebook orMySpace: rather than being a vast self-contained world centered on one Web site, Twitter dreams of being a tool that people can use to communicate with each other from a multitude of locations, like e-mail. You do not have to visit the home site to send a message, or tweet. Tweets can originate from text-messaging on a cellphone or even blogging software. Likewise, tweets can be read remotely, whether as text messages or, say, “status updates” on a friend’s Facebook page.

Unlike Facebook, which operates solely as a Web site that can be, in a sense, impounded, shutting down Twitter.com does little to stop the offending Twittering. You’d have to shut down the entire service, which is done occasionally for maintenance.

2. Tweets Are Generally Banal, but Watch Out

“The qualities that make Twitter seem inane and half-baked are what makes it so powerful,” says Jonathan Zittrain, a Harvard law professor who is an expert on the Internet. That is, tweets by their nature seem trivial, with little that is original or menacing. Even Twitter accounts seen as promoting the protest movement in Iran are largely a series of links to photographs hosted on other sites or brief updates on strategy. Each update may not be important. Collectively, however, the tweets can create a personality or environment that reflects the emotions of the moment and helps drive opinion.

3. Buyer Beware

Nothing on Twitter has been verified. While users can learn from experience to trust a certain Twitter account, it is still a matter of trust. And just as Twitter has helped get out first-hand reports from Tehran, it has also spread inaccurate information, perhaps even disinformation. An article published by the Web site True/Slant highlighted some of the biggest errors on Twitter that were quickly repeated and amplified by bloggers: that three million protested in Tehran last weekend (more like a few hundred thousand); that the opposition candidate Mir Hussein Moussavi was under house arrest (he was being watched); that the president of the election monitoring committee declared the election invalid last Saturday (not so).

4. Watch Your Back

Not only is it hard to be sure that what appears on Twitter is accurate, but some Twitterers may even be trying to trick you. Like Rick’s Café, Twitter is thick with discussion of who is really an informant or agent provocateur. One longstanding pro-Moussavi Twitter account, mousavi1388, which has grown to 16,000 followers, recently tweeted, “WARNING: http://www.mirhoseyn.ir/ & http://www.mirhoseyn.com/ are fake, DONT join. ... #IranElection11:02 AM Jun 16th from web.” The implication was that government agents had created those accounts to mislead the public. ABCNews.com announced that Twitter users who said they were repeating (“retweeting”) the posts from its reporter, Jim Sciutto, had been fabricating the material to make Mr. Sciutto seem to be backing the government. “I became an unwitting victim,” he wrote.

5. Twitter Is Self-Correcting but a Misleading Gauge

For all the democratic traits of Twitter, not all users are equal. A popular, trusted user matters more and, as shown above, can expose others who are suspected of being fakers. In that way, Twitter is a community, with leaders and cliques. Of course, Twitter is a certain kind of community — technology-loving, generally affluent and Western-tilting. In that way, Twitter is a very poor tool for judging popular sentiment in Iran and trying to assess who won the presidential election. Mr. Ahmadinejad, who presumably has some supporters somewhere in Iran, is losing in a North Korean-style landslide on Twitter.

6. Twitter Can Be a Potent Tool for Media Criticism

Just as Twitter can rally protesters against governments, its broadcast ability can rally them quickly and efficiently against news outlets. One such spontaneous protest was given the tag #CNNfail, using Internet slang to call out CNN last weekend for failing to have comprehensive coverage of the Iranian protests. This was quickly converted to an e-mail writing campaign. CNN was forced to defend its coverage in print and online.

Friday, June 19, 2009

As a health care provider, I was fascinated to discover that many governments, health care agencies, and private groups are increasingly using Second Life as a medium to communicate health-related information.

A study that analyzed the depth and breadth of this information (using the second life search engine), categorized all health care related activities into five groups: education & awareness, support, training, marketing, and research. The education sites offered information on many health topics and links to other websites. The support sites provided direct access to doctors, other health care professionals, and peer-support groups. The training sites were directed primarily to people in the health care industry and consisted of classrooms, lectures, simulations, etc. Some even offered real academic credit. The marketing sites mainly promoted health care services, fundraising, and health care initiatives. The research sites were used as recruiting tools for health care research.

I would expect the support and marketing sites to me the most useful. The peer support communities offered in second life can offer the anonymity and supportive functions of a real-life group in addition the convenience of the internet. Health problems are extremely sensitive issues and many people may feel more comfortable interacting with people through Second Life than any other medium. In this sense Second Life truly adds to the health care community. The marketing sites also seem important, because it allows for special groups to be targeted. This, however, is less unique given the use of social networks such as facebook.

The other sites do not seem as unique given the vast amount of health care services dispersed throughout the rest of the internet. For example, as search engines became more sophisticated, the availability of health information increased dramatically. Second life adds to this availability, but it does not appear to provide more accurate or appropriate information.

In Prof. Kagan's 5th lecture when we were reviewing Music Downloading and Peer to Peer Networks it was mentioned that it was hard to find and sue the large foreign P2P network sites responsible for illegal file sharing because new sites are constantly popping up and the file downloading is between computer to computer with servers outside the US. A comment I was thinking about during the lecture was that it is still easy to place the blame on individuals and it seems that continuing suing individual people could provide a scapegoat to attempt to reduce the number of illegal downloads. In class it was discussed that "despite all of the advances in online music sales, tens of billions of illegal files were still swapped in 2007 maintaining the ratio of unlicensed tracks downloaded to legal tracks sold at about 20:1.

Well, it seems that is the tactic of a music industry on its heels, as a verdict of $1.2 million dollars in damages was awarded to the Recording industry Association of America (http://news.yahoo.com/s/ap/us_tec_music_downloading) in a jury settlement that claimed that a Minn woman who illegal shared 24 songs was responsible for $80,000 per illegal shared song. In 2005 the RIAA declared, "Pretty much everyone who uses such services is now a target of the IFPI. Initially, it is chasing what it calls "uploaders", who let files on their machine be available for download by anyone else using the services."Age doesn't seem like a deterrent to the RIAA as well. When a woman denied downloading illegally and said it was actually her 13 year old daughter, the RIAA dropped the case and instead decided to go after her daughter!

While this is a long heated debate, this hefty fine should ripple throughout the community in the coming weeks. While the $3,500 settlements hardly deterred P2P sharers, I think this example will scare the parents out there , who's kids might cost the family a lot of money and troubles, into opening their wallets a bit wider and using the traditional means of purchasing music. In addition, the music industry has had some success in attacking the large P2P sites and having them convert to a legal distribution model, however, going the personal route might be the most effective means though this could lead to a backlash by programmers and lead to even newer technologies to get music.

Thursday, June 18, 2009

What impact will virtual world bring to the real world?A major controversial and debatable point about the development of virtual world is what impact will it bring to the real world.

Second Life seems to be quite the progressive tool. Everyone seems to be very positive about this new technology and the impact that it already has on the world in terms of significantly improving communication, social networking and business platforms. However, people are beginning to raise concerns about the possible effects of the booming of virtual world. Will it negatively affect human behavior in terms of bringing violence to the real world the way other computer games do? Will it undermine some basic social concepts like marriage, family, ethics or even morality? Since virtual worlds use the same resources in real world like time and human power, will the flourishing of the virtual world reduce or even deplete the resources and productivity in the real world?

The bright side of the virtual world is quite easy to see and to be excited about. Many believe that “Second Life” is where society and technology should be headed – simply because the possibilities are endless. Who wouldn't want to go to a place where all of your imperfections in real life are nonexistent; a place where you can look as slim and as sexy as you always wished you were; a place where all of the problems of the real world (e.g. pollution, climate change, hunger, genocide, over population, war, etc.) do not exist? It may be wonderful to take just the good aspects of the real world and build an alternate reality with them. Virtual worlds have allowed us to do so - but is that good? We may still be distant from the extreme of computers taking over mankind, but we cannot deny the possibility of a situation arising one day when we have to choose between the red or blue pill as Neo did in the Matrix.

Wednesday, June 17, 2009

I am pretty sure I am the only person with my name in the world. 99.9% of the time having such a difficult to spell/pronounce first and last name combination is a big pain: I constantly receive misplaced letter; have my name mangled by strangers to the point that I don’t even recognize it; and even have classmates/friends spell my name incorrectly on group papers and correspondence from time to time. But then there’s the .1% of the time that having such an unusual name actually pays off: case in point, I was very easily able to secure my Facebook vanity plate this past weekend.

I tell you this not to rub it in the noses of you that weren’t able secure your name, but because I recently found out that Facebook had originally planned to auction of these vanity plates to the highest bidder. I am fairly certain that I personally wouldn’t have paid to have my vanity plate even if I had a more common name like Sally Jones, but I am also fairly certain that most people out there would have been wiling to pay money for this perk and that I am probably the exception.

So given that a significant percentage of users would probably be willing to pay, why then did Facebook give these away for free? The official reason that Facebook executives eventually changed their minds was because they (a) didn’t want to seem elitist by giving richer people a leg up and (b) feared that hosting several million mini auctions (one for each name) simultaneously would have overloaded the system. I personally think this was a real poor business decision on Facebook’s part. With over 6 million users out there Facebook could have potentially made millions of dollars on this deal (even by just charging something nominal like a one-time charge of $10/ a name (in the US- adjusted to in other parts of the world, or perhaps free in some countries)). Surely, charging a nominal fee like this wouldn’t have been an issue to a large number of users, especially since the service is free. At the very least, Facebook should have charged corporations for vanity plates. Even this would have made the company thousands (if not millions) of dollars. I personally think Facebook made a huge mistake and its only a matter of time until Facebook executives started kicking themselves in the butt for passing up this great opportunity to monetize.

Tuesday, June 16, 2009

Record labels are still searching for ways to earn money online and they may have stumbled upon a service that could bring them back into the value chain: it's called "Vevo". Universal Music started the site and they have already gotten a corsortium of the major labels to sign up.

Itunes has proven that there is still a market for downloading music singles. But it has also proven that people still love to watch music videos - and that they are willing to pay for them! Since MTV became a reality television show rather than a music video channel, there aren't many places these days to watch high quality music videos.

That's where Vevo comes in. Vevo is a music video site. It will host music videos from the major label, top grossing music artists. Universal plans to host music videos on its site and to complement the content with exclusive interviews, reality programming and live performances.

This time the music labels are not licensing and restricting content but making it all available in one easy to find space. And once they get a critical mass of users, they will be able to bring in the advertisers and start making big bucks again.

This model just might work. The videos on youtube are usually low grade and low quality. Vevo could ensure access to high quality and exclusive content. If it can pull it off, users may come en masse, and the music labels may finally be able to insert themselves back into the value chain.

Since the advent of the digital age, society has become obsessed with being connected. Connected to information. To music. To media. To the thoughts ideas and opinions of other users. Basically, we all want to be plugged in and actively contributing to the colossal forum of activity that is the world wide web. Moreover, not only do we want to be connected, we want to be connected to what we want when we want it, with no unnecessary steps between our screens and precious information or entertainment we seek. However, with increased information sharing comes increased anxiety. If you are connected to information from countless strangers, who is connected to information from you? Moreover, what happens to that information once you send it out into the www forest? We all know the feeling: Should I enter my birthday this site? Is this credit card payment page really secure? Who else might see the content of this email? Opera has displayed a keen understanding of the world’s insatiable desire for customized connectivity, as well as the paranoia that such a luxury generates, with what may be the next “reinvention of the web: pre-launch web browser Opera Unite. What makes this browser different then other web browsers? Essentially, everything. In short, Opera Unite is designed to directly link the personal computers of users operating on browser, regardless of what operating system is being run on each individual PC. Such a dynamic would mean users could share files and information directly with one another, without the need for a third party or any kind of additional and common software. Moreover, Opera is encouraging developers to create their own applications on top of the browser, thereby facilitating a the ability to customize individual user experiences to a much higher degree. Another interesting outcome of directly linking users computers comes in the promise of increased control. Currently, individual’s personal computers are merely gateways. Information is sent out of our gateways to server that acts as the “hosts” of the Internet. Therefore, our word, photos, emails, etc. are not actually delivered to the “fabric” of the Internet, but rather to these servers. Opera Unite claims to change all that. By directly linking the computers of individual users, Opera Unite promises a much higher standard of privacy and the ability to control the sets of eyes and ears plugged into your most sensitive information. Check out the full story here:http://www.techcrunch.com/2009/06/16/that-reinvention-of-the-web-thing-opera-was-talking-about-its-called-opera-unite/

Job hunting on social networks such as Facebook, LinkedIn, and Twitter has grown even more popular since the onset of the current economic crisis. As unemployment rises and job availability decreases, more people are looking beyond conventional methods to find a job.

Social networks can provide multiple advantages over conventional job search tools. They can potentially provide the most current and accurate information on job availabilities. For example, an employer can send out an update on a new job opening to Twitter subscribers. These job seekers would receive much more relevant and up-to-date information than searching through a head hunter. Social networks also provide a promotional outlet that differs from conventional outlets in that there is more room for creativity and personalization. Job seekers are given a unique opportunity to express themselves in different ways and can promote strengths that typically go unnoticed. This would obviously benefit employers as well. Social networks provide useful information about potential employees that was never available in the past.

This last point relates to the disadvantage of social networks. Social networks can provide so much detail, it is difficult to selectively keep some information private. For instance, an employer can learn about a job seeker's friends, activities, social behavior, political/religious beliefs, personal photos, etc. Without careful editing, a social network can easily ruin a potential employment opportunity.

For the past 10 years, I have frequently visit an online discussion forum called Fatwallet.com to search for potential deals, purchase advise, as well as information about current technologies.

http://www.fatwallet.com/

Although forums and blogs share many similar features, the most noticable external differences are that forums tyically requires registration and posts are categorized and sort in chronological order and blogs are sorted in reverse-chronological order. From an internal aspect, forums tend to be harder to crawl and index, where blogs are much easier to search for.

However, from a marketing perspection, I would argue that forum is as effective as an marketing tool as blog. Although blogs are generally more suitable for company updates and new product review or launches, discussion forums allow a more organized way to look for previously answered questions on specific subject, which allow advertisements to be targeted the particular reader or posters' interest. Discussion forums are generally formed and catered to a specific hobby or topic or interest group. Advertisements targeted to those interest can easily be place in order to promote specific products, services, or brand. In fact, I believe that discussion forums tend to attract a more subject focused visitor than blog. Also, discussion forums allow interaction between users via private messaging or direct response to comments, where as blog is generally viewed as an interaction on content.

However, I felt that discussion forums have lost its attention in regards to Blog in recent years, blog being the buzz word and discussion forums are closing down one after another. In fact, during our lecture on user-generated content (UGC), the Professor did not mention too much about discussion forum as a UGC website.

Personally, I like forum more than blog because it's more organized and easier to browse and look for information. In reality, both can be benefitial, and I believe both can be used to accomplish different marketing objectives.

Gov Schwarzenegger wants to cut hundreds of millions of dollars in state spending each year.He says converting to online study will also help keep pupils more up-to-date. From the beginning of the next school year in August, math and science students in California high schools will have access to online texts that have passed an academic standards review.

While I am all for the cost saving initiatives Gov. Schwarzenegger is trying to implement. I cant help but wonder if this may further disenfranchise some economically disadvantaged students. What happens if a student does not have a computer at home, or does not have access to the internet at home. Will he or she be given a computer or will they have to do all there studying at school.

In spite of this, I believe if all students actually have access to theses online textbooks, it perhaps can spawn a reinvigorated zeal for education and academic excellence within the student body.

MySpace announced today it will cut its US workforce by 30%, which represents about 400 employees.

This move comes just 2 months after a new management has taken office, appointed by Rupert Murdoch. News Corp. had always stated that MySpace was "very profitable", whereas it is no secret that its competitors have yet to post meaningful profits. Still, Mr. Murdoch had expressed for some time that MySpace was oversized staffwise relative to its peers. We note that MySpace will retain 1,000 employees in the US, which is higher than Facebook's 850 employees.

We have discussed in class how MySpace was losing grounds to its more recent and "nimble-footed" social network competitors.According to data from Nielsen, online traffic on MySpace in April dropped 31% year on year. The network has today 130 million registered users, vs. 250 million for Facebook. A year ago, MySpace was still ahead... the fall has been spectacular.

Therefore, the lesson is the following : for all the talk about how social networks revolutionize the way people interact with each other and how they affect traditional media... they eventually remain bound to the same rules as traditional businesses: they have to make money, and when they don't, they downsize and restructure, just as General Motors does....

MySpace's new management team is headed by Owen Van Natta, a former Facebook executive himself. Does that mean that MySpace is going to try and merely replicate / adapt its competitor's model, or on the other hand does this move signal the Company's determination to gain back its creativity and dynamism, which ultimately will be its growth drivers?

Confession....I do not use Twitter, I do not tweet, I do not want to tweet. I feel like a dieing breed, but I'm not so sure. I am not anti technology, or even anti social media, I do have a Facebook account and occasionally update my status and like it. But for some reason I just have not jumped on tweet crazed bandwagon.

Is it that I am already too old? I'm 31. Does that put me out of the demographic? Who exactly is the demographic? I'm sitting at a table of three 31 year olds and one 22 year old. None of us tweet. I know this is a pathetic sample size, but I wonder if just as rapidly as this twitter crazy developed can it or will it die out too?

Pet Peeve...Well over 45 year old congressmen and women, newscaster, and other "celebrities" raving about their tech savvyness as evident by the amount of time they spend tweeting and asking people to follow their tweets. I'm jaded, I know. It just feels contrived, as if they just read some self help book like "How to look cool to young people 101".

Silver Lining...Ordinary people who tweet about relevant current news events and natural disasters.

After reading Hanah's post on dis intermediation within health care services, I was reminded of my trip to Ugnada last Christmas. In Uganda, as in many sub Saharan countries in Africa a medical doctor is not required to obtain a prescription or to buy what in the US would be considered prescription strength medication. There are many reasons for this, but the two most commonly sited reasons for this is that doctor visits are cost prohibitive for many citizens and that trained doctors often do not want to reside in the more remote locations.

Although there are many risks involves with self diagnoses, in these situations the possibilities of dis intermediation through the internet can actually be life saving. In addition, the apparent dis intermediation can actually serve as a way to increase traffic to qualified doctors. Patients can learn to recognize symptoms that can be treated and cured by medical professionals.

Facebook began offering vanity URLs last week. Unnoticed by many Facebook users their URLs were actually a strange mix of geeky numbers, i.e. www.facebook.com/profile?php.id=98765432. But now Facebook, much like twitter will allow its users to customize their URLs with whatever name they choose.

For me this is another interesting diversion from the clear identity base that Facebook was founded on. Initially, Facebook was restricted to users with a .edu address. Because of this, the majority of people on Facebook used their actual names. This trend of using ones actual name to some degree has continued inspite of Facebook no longer requiring the .edu address. With the advent of Facebook vanity URLs I wonder if Facebook will head in the direction of other online social networking sites with users hiding behind aliases.

I actually thought it was a strength and a distinguishing factor that Facebook users identify themselves by their actual names. It adds a measure of accountability to users actions online.

Twitter recently launched a virtual currency that users can use to donate to charities or give to friends for doing good deeds. The conversion rate is equivalent 10 cents for 1 Twollar, but users pay $0 to start with 50 Twollars. All in all, Twollars is a Twitter "thank you money" which is designed to benefit good causes. The process behind Twollars is as follows: users donate the currency to charities, brands sponsor charities by purchasing the Twollars from the charities and the charities get real world dollars from the sponsor. If 5000 Twollars are donated to a charity event then the brands would make the pledge to pay for the event $500. In the article, "Twollars: An Innovative Approach to Fundraising on Twitter", http://mashable.com/2009/05/26/twollars/, Stan Schroeder goes into details about the redesign and the full life cycle of commerce using the currency.

The technology behind Twolllar is not complicated or costly. Queries are used to parse Twitter's data and look for a format such as "20 Twollars @username to charity name"

The Twollars concept emerged from the social media environment, and I believe it should be used as tool to help traditional marketers approach this channel more effectively. Traditional bands tend to approach the social media market with a broadcast mentally as opposed to a user participation ideology. The Twollar approach facilitates user involvement by interacting with the brands as well as the charities.

I believe this model has legs as long as Twitter survives by generating revenue from other sources. Twollar can replicate this model to other social networks and cross trade the currencies across multiple platforms. Twollars needs to maintain its reputation by not over supplying the market with too much cheap currency and therefore diluting the value even more.

I find the virtual currency economy an interesting area. Cyworld and SecondLife have been successful in implementing their virtual currencies, but many others have failed such as Flooz.com. In recent weeks, the buzz about Facebook’s Credits, a virtual currency system that allows users to purchase virtual gifts or send the currency to friends. Facbook's objective is to generate revenue streams by fostering commerce on its platform. The currency system encourages participation by having users develop more content, and accumulating credits. Facebook has grown at a rapid pace to over 200 million users, and the potential to generate revenue streams is enormous.

I know that generating revenue in a social media ecosystem is complicated - especially when the users are accustomed to the platform being a free and fun service. Introducing the payment system that works well will be a challenge for the management team. Other feature that should be considered are expanding the currency use on Facebook Connect sites and being able to easily convert the credits to real work dollars. A successful deployment of currency system will make it more relevant and potentially a major competitor for PayPal. Facebook has to justify their $10 billion market value, and banking on the currency payment system as significant revenue stream is an excellent idea but a risky one too.

Two weeks ago, Professor Kagan opens the lecture by reporting on the current news events of the week. He spoke briefly about Google's Wave, a new online communication and collaboration tool, and Microsoft's Bing, an improved search engine. Last week, I decided to explore both applications. I watched the Wave preview video for only 20 minutes, and used the Bing search engine searched occasionally throughout the week. My first impression of Wave's integrated instant messaging and e-mail platforms was very positive, and continued view Google as an innovative company. However, the Bing user interface is impressive, but I had no "Wow!" effect. In the short run, I will use Bing occasionally, but I will most likely remain with Google as my default search engine. I introduced Bing to a co-worker, but he did not seem too excited about the search engine. Bing has two big issues: Google's reputation as the leader in the internet industry, and Microsoft image as a Windows company that stifles innovation. Microsoft evolved from an era where the company controlled technology and dominated its sector. On the contrary, Google evolved in the era of the World Wide Web where open source software and free software are the norm. Microsoft's reputation as a controlling company may have, also, hurt its brand and the recent product launch of Bing. Making matters worst, in the article by Ben Parr (http://mashable.com/2009/06/07/blindsearch/) that compared the results of Google's search engine with Bing's was not positive for Microsoft. The blind test shows that users perceive that Google's search results are more accurate and relevant than Bing's and Yahoo's. Google with be force that Microsoft will have to reckon with in the future. Although Microsoft has financial and intellectual resources to sustain the company as player in the internet era, Microsoft my have to play from the back seat until it changes its mindset and image.

Monday, June 15, 2009

In an interesting article from AdAge.com: http://adage.com/digital/article?article_id=137295global marketing raises an eye as marketers become more and more aware of who is doing, or more appropriately "where" the clicking is taking place - and the costs that are incurred because of it. Interestingly enough, "the international pull of the web has been felt strongest in search, social networking and video sites." These are the very areas that marketers are having the hardest time reaching.....however, "the reality for most websites is that international traffic represents more of a cost than a source of revenue. "They're getting 70% of your impressions [from international] but it becomes 5% of their revenue, if they're lucky," said Tyler Moebius, CEO of ad network Adconion" Learmonth's article also sites an online video provider that purposely blocked international countries to stop its costs from rising. It seems that the answer not only lies in how to market on these particular sites, but now it seems like the greater challenge will be reigning in the international market and how to get them to become better consumers not just bystanders. The person(s) who figures that out will not only reach US, but the entire world.

YouTube has faced heaps of trouble when it has come to perfecting a model to garner advertising revenue from ads placed inside actual videos (as opposed to just on top or next to the content). For a site built solely from UGC, getting users to swallow advertisements in the form of interjected pre-roll clips can be extremely challenging. However, the question is why? In an age where advertisements are part of our daily experience with media (television, radio, even movies are lined with advertisements from top to bottom) does a site like YouTube have reservations about sticking a quick pre-roll on some very popular clips? It can be argued that the answer to this question lies in why Web 2.0, and UCG in particular, gained popularity so quickly. And that answer is: user control. YouTube visitors have become accustomed to controlling every aspect of their interaction with the site including content generation. Each user chooses what videos to display, what parts of the video to watch, how many times they watch a given video back to back, what to rate the video, if they want to include a new video in the YouTube database…the list goes on and on. Thus, the presence of an unsolicited and unavoidable clip of video, however brief, represents a huge deviation from the current YouTube experience. Furthermore, as most YouTube videos are short form, the chances of an advertising pre-roll doubling the total length of the entire clip are fairly good. While this may seem like a non-event at first glance, consider the following scenario: A designer who used to sit next to me at work had the habit of looping YouTube music videos so he could listen to the same song over and over again while working. He said the repetition helped the music fade into the background so he could concentrate on his work undistracted by lyrics while simultaneously enjoying the creative stimulation of the music’s rhythm or beats. However, had this music video been proceeded by pre-roll this guy would have had to listen to the same advertisement each and every time the video looped. I would venture a guess that this would have broken him of his music video looping habit, but in doing so, this advertisement would have effectively altered the way he as a user interacted with YouTube.com. In short, it would have stunted his ability to customize his user experience. While such an argument presents a conundrum for YouTube, their most recent approach to advertising seems to display sensitivity to the fact that users are used to exhibiting control over the content they interact with on YouTube. In short, YouTube is testing a system where users are required to watch a “promoted video” before viewing certain clips. However, the user can select from a series of options for that promotional video accompanied by ratings for each option. Furthermore, the user can elect whether to watch one pre-roll or several different stream ins during the duration of the video. While users are still being forced to interact with unsolicited content, the perception of controlling the interaction is held intact. For the full story check out the link below:http://www.techcrunch.com/2009/06/15/youtube-choose-your-own-adventure-emphasis-on-ad/

I've been thinking a lot about the idea of disintermediation since last week's class. When we discussed this in class, it seemed that all of our references and examples were specific to retail, albeit different product categories. But how might the idea of disintermediation apply to non-retail fields?

Medical professionals have been voicing more and more loudly their collective disapproval of online services that give users detailed explanations of illnesses, symptoms, medications and prognoses. To my understanding, it's not that doctors and nurses do not want patients to do their homework in more deeply understanding their professional recommendations; rather, it is that patients are now turning to sites like WebMD to self-diagnose, and they often expect their own determinations to carry substantial weight in the doctor's office or hospital. Are medical professionals the next "middle men" to be disintermediated?

While this example would seem a bit ridiculous on the surface, it is happening more and more, as evidenced by WebMD's inclusion of the following phrase in its editorial policy: "Be aware, however, that information on WebMD or any other web site should not be used as a substitute for professional healthcare." Clearly, WebMD itself is aware of the potential for users to disintermediate their own doctors, going directly to healthcare journalists, sponsoring pharmaceutical firms and professional editors.

so Selena, Greg, Nalinee, Michael and I submitted our paper on Chrysler's online marketing effort last week. An interesting article was published the day right after the deadline on Ford's Fiesta Movement campaign, which we documented in our paper.The campaign started in April 09, for a car which is not scheduled to be available by late 2010. The online article was the first attempt we saw at providing some feedback on Ford's effort.

A couple of months ago, Ford decided to provide 100 people with a free Fiesta for 6 months, in exchange for a promise to provide Fiesta-related UGC on a regular basis, as they see fit (youtube videos, twitter posts etc.) . This was a bold move in the sense that Ford has no control whatsoever over the content which is going to be produced...

According to the article, the first signs are extremely encouraging. In 2 months, the 100 drivers have created over 4.6 million impressions, and some individual video clips on youtube have been viewed over 150,000 times (one not so successful example can be seen here: http://www.youtube.com/watch?v=ks6rH0aJBwg )!

Qualitatively also, the feedback has been positive. One driver even posted how the car had saved her life after she had an accident with her Fiesta!There were of course a few negative comments, but that was to be expected. A lone but surprising false note came from one driver who said he had to edit one of his videos at Ford's request...

So, after 2 months, Ford's innovative online campaign looks promising. Still, the launch date of the Fiesta is almost 2 years away.... Time will tell !

Okay, so it's the night before our exam is due and for ONCE in my academic career I've finished ahead of time. Figures. The one time waiting until the last minute may have been a good idea.

I just came across an article that mentioned DELL (as in the computer manufaturer) released the fact that is has made over $3mm in sales from clicks through Twitter over the past two years. Okay, so perhaps this seems like a relatively small amount of revenue for a company that made almost $13b in revenue in the first quarter of 2009, but I was fairly impressed. I mean, Dell only has about 600,000 followers on Twitter and again, the number of people (as a % of the population) that is even ON Twitter yet is very small. If they can generate that kind of revenue with a small following, imagine what they could do if Twitter was even more mainstream.

But again, this post is about monetizing Twitter. Basically at this point, Twitter allows a company like Dell to post coupons, links and other sales information without charge. Let's imagine that instead, they charge a click thru fee or even an action based fee. Moreover, Twitter could even put coupons or information of various companies together (like beauty or tech) in one stream for users to follow. Of all the different ideas circulating for how to monetize the site, to me this one is the most obvious because it doesn't impact the user at all. Once you give users something for free, it is almost impossible to start charging them for it without making them unhappy. In addition, the companies get something out of it because they will see increased revenues, especially if the coupons are aggregated into one stream based on interest. Finally, I believe this is even superior to slipping in an advertisement every 10th tweet or so, again because it is virtually invisible to the end user.

Shirky shares some very succinct and really illuminating views on how the Internet is advancing collaboration in a number of different arenas. I especially appreciate his use of some colorful anecdotes to dramatize the concepts.

This discussion sheds some light on aspects of Internet marketing that transcend sales: namely, "social marketing." Shirky discusses how communications technology is supporting collective action, including cause advocacy, politics, and in some cases, efforts by consumers to protect their interests in the face of threatened infringement by corporations upon their privacy or their contractual rights.

Shirky elucidates a whole historical trajectory of technological advancement, culminating in current Web 2.0 innovations, as a means to facilitate free and open expression -- and he ties it together into a moving and sharp commentary on our society. Ultimately, he poses a question that is worth really mulling over, especially for the entrepreneurs among us: if institutions have largely taken shape over time to cope with "the difficulty of managing information," how will a sea change in the way we manage information ultimately force a dramatic change upon the institutions in our society? What are the implications for our leadership, our businesses, and our educational system?

... and if that interests you, and doesn't completely blow your mind, see his 2005 talk on the challenges that new media will pose to institutions (corporate and government), which has already proven to be quite visionary.

The Wall Street Journal reports that the complex interaction between businesses and their online ad sales deals leave websites open to hackers. The British entertainment website Digital Sky was reportedly hacked as one of its banner ads loaded malicious spyware onto users' computers. Because the viruses are loaded directly in the ad, just clicking on them is enough to infect a computer.

One of the reasons why this is happening is because companies are outsourcing their ad-sales to third-party ad dealers, opening them up to the possibility of ads that aren't legit. Other hackers place their ads directly onto sites, masked as other companies: for instance, EWeek.com displayed an ad on its homepage that looked to be a banner for the clothing company LaCoste. But LaCoste hadn't placed an ad; instead, it was a hacker whose ad directed clickers to a website where harmful spyware would be downloaded.

Some anti-virus program makers are now taking steps to minimize these kinds of attacks. Kaspersky Anti-Virus, for example, is now blocking advertisements from prominent advertising network Doubleclick, on the premise that Double-Click sometimes displays phishing ads. Now instead of the ad, readers get this warning:

Viruses spread through web ads are nothing new; in fact the WSJ reported this same story two years ago. It's worth considering that the inability of websites to guarantee secure advertising may inhibit the growth of web ad sales. Without trust in security, how will people click comfortably?

Thanks to the success of E-Paperenabled products such as the Amazon Kindle and the Sony Reader, E-Paper pioneer E-Ink was acquired for the grand sum of $215M.

http://bit.ly/e_ink

Incidentally, I worked for E-Ink in a Sales and Biz Dev role which I found extremely interesting.

What makes Electronic Paper relevant in a world that is increasing consuming content on bright, video-enabled LCDs whether it be on iPhones, notebook PCs, or flat screen TVs?

1. Electronic Paper is the ultimate digital reading experience. Yes, you can view entire books on your 3 screens, but you are basically staring at a light bulb that refreshes 60-120 times a second. E Paper requires no refresh, does not emit light (but rather organically reflects ambient light), and emits no radiation while displaying content. It truly looks and feels just like paper.

2. Electronic Paper is the worlds only ZERO power screen. Whereas you need to juice up your iPhone daily, recharge your notebook PC every 4 hours, and plug your LCD TV into a wall socket, E-Paper devices can display over 50 books worth of content between charges, providing weeks of reading.

3. Electronic Paper is the world's first commercial producible flexible digital screen technology. Why be limited by shatter prone, thick, rectangular glass displays? Imagine a screen that rolls out of an electronic device like a phone providing a viewing area bigger than the device itself:

http://bit.ly/readius

Electronic Paper will be the 4th screen that allows you to access digital content in a form as warm and welcoming as your favorite paper novel.

Three pillars of the entertainment industry—music, movies and video games—are facing economic challenges due to the disruptive influences of digital distribution.

“The music industry was knocked off balance by the emergence of the MP3 in the late 1990s and has not recovered, and Hollywood’s two core businesses, box-office receipts and DVD sales/rentals, have stopped growing,” says Paul Verna, eMarketer senior analyst and author of the new report, Digital Entertainment Meets Social Media. “And while the sales of video game consoles and software titles remain relatively strong, the industry’s future is shifting to digital distribution and ad-supported models.”

To take music as an example, spending on CDs and other physical sound carriers dwindled to $5.8 billion in 2008, down 60% from a peak of $14.6 billion in 1999.

US sales of recorded music will drop to $5.52 billion in 2013. This downward trajectory will extend a pattern that began in 2000, when physical sales started to decline after rising dramatically during the heyday of the CD.

“Online will experience healthy growth, mobile will trend slightly downward and physical will continue to plummet at accelerating rates,” says Mr. Verna. “Unfortunately, the sum of online and mobile will not compensate for losses in physical, but it will slow down the rate of those losses to a 2.9% drop in 2013.”

In 2008, single downloads made up the bulk of digital music sales, over $1 billion.

An NPD Group survey revealed a nexus between music and social media, finding that the percentage of US teens who downloaded or listened to music via social networks increased from 26% in 2007 to 46% in 2008.

Many music fans are gravitating to social sites via iPhone applications.

The Pandora app has been a huge success, with more than 4 million users as of May 2009, and about 20% of the 1 million songs per month downloaded through affiliate links were from Pandora’s iPhone app.

“The iPhone was game-changing for Pandora,” says Jessica Steel of Pandora. “It was the first device where the light bulb went off for listeners and those in the industry that Internet radio isn’t about just a Website and a PC anymore.”

“Clearly, this is a period of experimentation for the music business and social media,” says Mr. Verna. “The next step for these services will be to broaden their offerings into a user experience that straddles platforms and devices.”

Pepsi, Dove, Sprint, Doritos have all staged User Generated Contests asking for content in the form of possible advertisements. UGC contests are sometimes effective in promoting the brand, receiving quality ideas as well as content, and detailing information about the demographic of the brand. UGC contests also can achieve brand awareness within a company, an assessment of the personality of your brand for managers and employees within.

However, user contests today do not always have the greatest of marketing effects and could are costly. As the Vice President for Heinz ketchup said regarding their follow up $57,000 contest for creative TV ads, “Many entries are mediocre, if not downright bad, and sifting through them requires full-time attention. And even the most well-known brands often spend millions of dollars upfront to get the word out to consumers. “That’s kind of a popular misnomer that, somehow, it’s cheaper to do this,” he said. Also they have the possibility of unintended brand messages, “Some people, meanwhile, have been using the contests as an opportunity to scrawl digital graffiti on the sponsor and its brand,” says Heinz VP.

Some recent contests have been flops and some have been great successes. For example, Chicago Opera Theater, asked users to upload an up to 3 minute video of you explaining why you deserve two free opera tickets. The reward wasn’t great as it only gave two tickets to the opera and the suggestion video for contestants was the Chicago Opera Theater sexual innuendo about “my first time” at the Opera, not setting the bar high for a more upscale brand. Their efforts delivered 18 total videos though their costs to get the word out were probably low.

Murphy Goode Winery is running a UGC contest asking for applicants to submit a one minute pitch to them on why you would make a “goode” Murphy Goode employee. The winner receives a $10,000 a month salary for 6 months to consult with them on Web 2.0! I emailed them to ask what the purpose of their contest was. They also used an email verification process for those who wanted to vote on the best video. Was their purpose to promote the brand? Get a solid database of emails for marketing purposes? Maybe get web metrics of the areas of the country receiving most interest and start a marketing campaign there first? I think a combination of these reasons as well as a novel way to ask for resumes! So far no comment from the company but I will edit the post once received.

Brickfish CEO Shahi Ghanem, whose company has run 120 contests since August 2006, and Ben McConnell, consultant and coauthor of "Citizen Marketers" offer the following tips for User generated contests which I summarized below and are found here.(http://www.clickz.com/3627018)

Understand What Motivates Participation- win, recognition, or care for a cause.Recognize People's Passions- usually a consumer brand like pepsi isn’t one which is where prizes come in.Pick the Best Format for the Demographic- a UGC contest is not always best by video content.Ensure Transparency- people will participate if others are, show the buzzMaintain Realistic Expectations- don’t expect a viral buzz, market across channelsOffer Unique Prizes- sometimes fun prizes trump money, including trips to big events and meeting top peopleDon't Be a Bore- UGC contests are everywhere now so they must innovate and be fresh to compete.

Sunday, June 14, 2009

Wolfram Alpha, released on May 15th 2009, is an answer engine designed by Wolfram Research. This new engine answers factual questions directly instead of providing a list of websites that may have the answer. It derives answers from a core knowledge base of data. This method is similar to the way Google answers mathematical questions, but Wolfram Alpha searches a larger range of data. Although it has been frequently compared to Google, in reality it is fundamentally different. It would be more appropriately labeled an answer machine rather than a search engine. In many ways, Wolfram Alpha is more likely to compete with Wikipedia than Google.

Wolfram's business model contains much ambiguity. Apparently, Wolfram Research intends to sell subscriptions to advanced users who want to integrate their data with the Wolfram database. This strategy alone does not have the potential to produce another Google. There are simply not enough advanced users to generate revenues comparable to Google. This is why Wolfram also sells display ads, although it is unclear how advertisement works on the site and how this will generate enough revenue. On Wolfram's faq page, they state they are "concentrating on major corporate sponsorships" and not targeted advertising. Wolfram was initially designed purely for academics. If it plans to generate revenue through any form of advertisement, it must develop a larger network.

Much of this traffic is generated by TechCrunch's Twitter account, with over 700,000 followers. TechCrunch uses this account to send out story links, driving followers to its site. These tweets spread virally, as followers retweet (forward) the link to others. The main take-away from this post on TechCrunch is this = "Twitter is not just about micro-media. The most powerful Tweets are those which point elsewhere."

While TechCrunch is a unique site, with a demographic that is not representative of the public, there are clearly other opportunities in that statement. As an Arts Administration student, I can see how arts organizations (or sports, any ticketed event) could utilize Twitter to make sure no seats go unsold to any event. As Twitter provides real-time feedback, using Tiny URLs to send out waves of ticketing in tiered prices could allow for an instant gauge of demand and supply, in a perishable environment where the product has a limtited shelf-life.

Is Google really scared of anything other than the term 'anti-trust'? :)

According to James Doran in the New York Post on June 14th, "co-founder Sergey Brin is so rattled by the launch of Microsoft's rival search engine that he has assembled a team of top engineers to work on urgent upgrades to his Web service."

So why does Bing have Google scared?

Apparently there is something about the search algorithm in Bing that has Brin concerned - and the fact that one of Google's co-founders is so hands-on regarding this particular competitor has industry insiders taking notice.

Google and Yahoo! dominate the search market, with 60 and 20% market shares respectively, and Microsoft has been largely unsuccessful in competing - but Bing has been received favorably by critics, was launched with a gigantic marketing budget ($80-100M according to the Post), and early statistics show Bing increasing Microsoft's market share by two percentage points, to about 11 percent.

But 'Fear Grips Google' seems to be a bit of an overstatement by the Post at the moment, as Scott Kessler, senior analyst at Standard & Poor's and a Google specialist, notes the main motivations for consumers' choice in search is ease of use and habit - making Google harder to scare than an $80M marketing budget and favorable reviews.

While I've tried out Bing and find it to be quite user-friendly, the force of habit motivation that Kessler mentions is a difficult hurdle to overcome. It will be interesting to see how Microsoft proceeds in gaining market share once this initial marketing push phase is complete. Can they stay in the game, after setting the pace at $80-100M, to overcome this Google habit of ours?

Do you lie about personal information in your online profiles? New York City residents were interviewed and evaluated to check the accuracy of their profiles posted on Internet dating websites, including Match.com and Yahoo! Personals.Apparently, survey online daters admitted to being less than 100% honest about the info they post about themselves on dating sites. Men and women lie about their height, weight, age, but also income, politics, education, and smoking tobacco. After Professor Kagan brought it up in class, I made some research and came across with this article.

Psychological Study of Online Profile Accuracy

These individuals were asked to rate the accuracy of information such as physical appearance, social status, relationship information, habits, and beliefs on their printed-out online profile. Internet daters participating in this study also reported how acceptable they believed it would be to lie about the information on their dating profiles. Accurate information about their height, weight, and age was collected from the Internet daters, using a measuring tape, a scale, and their driver’s licenses.

Is Your Online Profile Accurate?

Overall, the participants reported to be very accurate about their relationship status and whether or not they have children – a sensible finding, considering that future romantic partners would easily find out if they had lied.

Study participants told experimenters that they had lied most often about socially sensitive subjects, including income, occupation, and smoking. Men were slightly more likely than women to lie about their income, and women were slightly more likely than men to lie about whether or not they smoked tobacco. Interestingly, men lied more often than women about their level of education, and women lied more often than men about their political views.

Lies about Height, Weight, and Age

According to their own admissions, both men and women often lied about their age and physical appearance in their Internet dating profiles. The researchers have precise data on these items, having measured them in the laboratory. Over 80 percent of the online daters lied about their age, height, or weight. Body weight was the most frequently inaccurate information, with over half of participants misrepresenting their weight by five or more pounds.

Female online daters were most likely to lie about their weight (59%), followed by height (42%), and age (13%). Male Internet dating profiles were most inaccurate about height (61%), followed by weight (55%), and age (24%).

Is it Acceptable to Lie in Your Dating Profile?

Overall, Internet daters participating in the Cornell University study reported that it was generally unacceptable to lie in online dating profiles. In general, participants told experimenters that it was least acceptable to lie about education and relationship status, and most acceptable to lie about income and interests.

Men and women differed somewhat in what types of lies were socially acceptable. Male online daters agreed that it was least acceptable to lie about whether or not you were in a relationship or had children, but believed that it is relatively acceptable to lie about income, occupation, politics, and interests.

Females dating on the Internet reported that lying about relationship historyandsocial status including occupation and education was highly unacceptable. Interestingly, while women were more likely to lie about being a smoker, they also considered lying about smoking highly unacceptable. Female online daters believed that it is (relatively) most acceptable to lie about hair and eye color, income, and interests.